Which are the topcontent distribution strategies for an online publisher? In this in-depth report authored by new media and future trends analyst Ross Dawson, you can find a thorough analysis of the present online content distribution paradigm as well as a set of useful guidelines and examples to make greater sense of content distribution. If you are interested in content distribution standards, aggregation, syndication and versioning trends, this is a must-read document.

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In an age where online content is increasingly spreading in contexts different than the original source, understanding all content distribution options and their pros and cons is absolutely crucial.

Here a quick look at some of the insights provided by Ross:

No single business model in content distribution is likely to be effective indefinitely, as technology progresses and consumer behaviors and attitudes unfold.

Choosing a single content distribution source rather than many, can dramatically reduce your transaction costs.

Companies that have a wide range of existing content need to convert it to common formats so it can be used in many forms of distribution.

Versioning - releasing content in a range of versions with different features or at different times - is one of the core strategies in the business.

The ability for users to pass on digital copies, sometimes after cracking the protection, has become a dominant factor that must be taken into account.

Find out how to leverage content distribution strategies to promote your most valuable web assets. Here the full report:

Five Steps To Effective Content Distribution Strategies

by Ross Dawson

When I wrote the book Living Networks the content distribution landscape was in the early stages of unfolding. Yet the strategies I prescribed then seem to be just as valid today.

The Five Steps

1. Build Evolutionary Business Models

The Microsoft Example

By 2001 analysts were growing concerned that Microsoft's revenue stream could falter, as the IT managers at large corporations began baulking at upgrading the software on all their PCs every time a new version of Microsoft Windows or Office was released.

The software titan was finally galvanized to implement the strategy it had been musing about for years - switching to licensing its software as an annual subscription instead of a one-off purchase.

Its new Software Assurance program gives users the right to receive all upgrades released during their subscription period, and includes support services.

It seems few customers were delighted by the change, partly because for many their licensing costs increased, and Microsoft was forced to backtrack slightly, including extending the initially planned five month transition period to well over one year.

Microsoft is already thinking of how it will further shift its business models to accommodate its .NET strategy, which will be described in chapter 9.

Key Steps To Build Evolutionary Business Models

Business models must be engineered to evolve in response to shifts in the landscape.

As the flow of information and ideas grows ever-more fluid, the balance between protection and promotion will change.

No single business model is likely to be effective indefinitely, as technology progresses and consumer behaviors and attitudes unfold.

There are two key steps to building evolutionary business models:

Actively experimenting; and

considering not just how to manage the transition into the new business model, but also how that model can later transition into another.

The truth is, no one can accurately forecast what will and won't work in content distribution.

Firms must experiment, try variations, see what consumers do and don't respond to, and do it in a way that allows them to readily shift and try other possibilities.

Pressplay, established by Vivendi Universal and Sony, in its initial launch offered four different pricing options, each offering a different combination of music streaming, downloads, and CD burns. As they monitor consumer response to this array of options, they can establish what pricing mix is most attractive.

Content Business Models and Stephen King

He offered his book "The Plant" in installments, bypassing publishers completely and selling directly to readers from his website.

People could freely download each installment, but were asked to pay a small amount for each part.

King said he would continue writing the book if sufficient readers paid.

By the fourth part, just 46% of readers paid for the download, and in November 2000 the author announced he would stop working on the book indefinitely, having reportedly earned almost a half million dollars after costs in the process.

As an independent author, Stephen King had the latitude to experiment more than large firms might, however by stopping mid-stream he has made it harder for others who want to try variations on his experiment, for example using DRM to protect content.

He probably also had not fully thought through the consequences of stopping the experiment.

Many of those who have paid $7 for the first half of a thriller probably no longer consider themselves Stephen King fans.

2. Define and Refine Strategies For Standards and Interfaces

The MPEG-4 Standards Issue

Imagine, as you watch a video being able to click on the actors' clothes to buy them, to zoom in when you want, or to get further information on locations in the film. No doubt you've read about this marketer's dream.

This can in fact be done today on the Internet, enabled by MPEG-4, the compression technology that is intended to succeed earlier standards including MP3. But the technology hasn't taken off yet.

In early 2002 MPEG LA, the licensing body formed to represent the 18 firms holding the patents that underlie MPEG-4, announced its pricing plans.

The proposed fees - that included per-minute fees for all streaming video - created an uproar as market participants struggled between wanting to use a powerful technology, and not wanting to pay what they saw as excessive ongoing fees for its use.

The Internet Streaming Media Alliance (ISMA) - an industry body seeking to establish open standards in the field, and representing over 30 major firms including Apple, Cisco, IBM, and Philips - weighed in with their concerns over the pricing scheme.

Taking advantage of the brouhaha, On2, a small video compression firm, offered the use of its technology to ISMA for free.

In the meantime, the primary competitor to MPEG-4 is Windows Media, with Microsoft carefully steering clear of alliances in this field.

This snapshot of intrigue demonstrates many of the key standards issues in the world of digital content.

Reflecting the basics of standards strategy outlined in Chapter 2, it is clear that firms can choose between establishing and profiting from standards, or promoting fully open standards that benefit the industry but level the playing field.

Those who play little role in standards setting, but use standards in their business (as do all content businesses), have to decide whether a particular standard is likely to succeed, the costs of implementing and using it, and whether to back just one horse or several.

Firms that wish to offer full-featured video over the Internet need to consider whether to invest in aligning their efforts with MPEG-4, Windows Media, or the other alternatives available.

The Gemstar Content Interface Strategy

Firms need not only to place their bets judiciously, but also to make sure they are able to switch courses mid-stream if necessary. There are similar issues with the interfaces that enable access to content.

As with standards - and indeed all of the flow elements - controlling these can allow firms to reposition themselves in the content distribution market.

Gemstar eBook is now one of the major players in the ebook market, with two of its early moves acquiring Nuvomedia, which makes the Rocket eBook, and Softbook Press, the maker of the Softbook Reader.

The original Rocket eBook worked by transferring ebook titles from PCs by serial cable after they had been downloaded from the Internet.

Gemstar eBook redesigned the next version of the Rocket eBook to include a modem, which enabled users to get dial-up access to an interactive catalog, and purchase books directly from the device maker.

Gemstar eBook had neatly shifted from controlling the interface to moving into the content distribution business.

Content providers and interface makers are often involved in intricate mating dances.

Content firms generally would like to make their offerings available through all devices, but sometimes they can benefit by aligning themselves with a particular interface.

In order to help establish standards, companies will offer lucrative deals to get exclusive content.

3. Develop and Implement Aggregration Strategies

The Aggregation Strategy of Getty Images

No doubt Mark Getty was thinking of the awesome riches accumulated by his grandfather - oil monopolist J. Paul Getty - when he set out with the intention of buying and building a business.

He openly admits he was searching for a fragmented industry that he could come to dominate. What he found was stock photography.

Today Getty Images is the largest player in a $2 billion industry, the product of 17 acquisitions made since 1995.

Getty and his colleagues had realized the value to its media, advertising, and corporate clients of being able to go to one source for their images rather than having to scour through many suppliers.

The advent of the Internet and high-quality digital photography has vastly simplified the process of searching for and obtaining images, but the same simple dynamic applies: If you can go to one source rather than many you can dramatically reduce your transaction costs.

How Online Content Aggregation Helps Buyers

One of the greatest boons of the Internet to business and consumers is the ability to bring together information in one place.

At the same time as buyers have gained access to many more suppliers, they are now able to consolidate and compare information on all offerings, and go to just one place for all their purchasing activities in any area. That's the theory, anyway.

Certainly B2B exchanges such as Free Markets allow purchasers to access global suppliers for complex offerings, AOL's shopping channel brings together retailers of all stripes, and websites like mySimon.com compare the prices of any given product across all online retailers.

Content Aggregation Strategy In The Music Industry

However because the position of aggregator is so powerful - in many cases essentially controlling the relationship with the end-customer - the battle to become the predominant aggregator in any market is often fierce, reflecting many similar dynamics to standards wars.

The Pressplay and MusicNet case provides a great illustration of the issues.

The reality is that all the five major labels would benefit if they provided one site for consumers to access all music. They have split into two competitive camps, even though consumers will never settle for music from just one group of labels.

This is different from other markets, for example cable TV, in which customers are likely to choose the set of channels they prefer rather than needing to access everything.

When these aggregators were being formed the question for each label was whether to participate, and if so which group they wanted to join.

Each of the major labels is powerful by right of representing top artists that people want to listen to, thus forcing consumers to come to their aggregator site.

EMI, a member of MusicNet, has hedged its bets by also making its music available through Pressplay. This means that it is potentially diluting the value of its stake in MusicNet, but accessing a broader market.

Independent labels that wish to distribute through these sites may choose to go through both - depending on exclusivity negotiations - but if so must bear the cost of providing their content under multiple formats.

In the meantime, the peer-to-peer file sharing networks are effectively aggregating music from all labels, thus making them attractive to users.

Napster is now seeking to position itself as a legal subscription service providing access to all content.

The major labels want to avoid licensing their content to others, so that customers are forced to go to their online retail units, however this raises antitrust issues.

Aggregators have the potential to combine market power to the detriment of consumers, and the Department of Justice has investigated numerous B2B exchanges as well as the music labels' online efforts.

4. Enable Versatile Syndication Models

News Sites Syndication Models

In 1865 the young newswire started by Paul Julius Reuter got its first big scoop when it broadcast news of Abraham Lincoln's assassination before anyone else in Europe.

Today, when you point your browser to AOL, Lycos, MSNBC, Yahoo!, or almost any of the other top new sites on the Internet, and you will see news provided by Reuters.

The Reuters content is delivered in NewsML - an XML format that allows its clients to select and present the information however best suits their websites.

Part of the power of NewsML is that it allows stories to be reformatted for different situations, for example using shorter titles for display on mobile devices, or changing references if used in different countries.

Content Syndication As a Business Model

Syndicationis one of the best-established business models for content.

By the early 1900s there were over 150 comic strips in syndication, and the business model is central to newspapers, radio, television, and just about every other form of content and media.

The global scope of distribution means it is difficult to negotiate with all end-users yourself, so syndicating intermediaries like iSyndicate, ScreamingMedia, and Factiva have a vital role to play.

The key role of customized content in relationships - as you saw in Chapter 4 - is making access to useful, regularly updated content critical.

The increasing cost of developing high-value content means syndication must be a core component of the business model.

Examples of Successful Syndication Models

CBS Marketwatch.com makes close to one third of its revenue from licensing charts and articles to other websites, as well as newspapers and wireless networks.

Salon.com has reversed the traditional flow of content by syndicating its material to print newspapers and magazines.

The variety of content formats and breadth of distribution possible today means that technology is at the heart of effective syndication.

Ad-hoc solutions will not scale effectively.

In order to provide content in ways that can easily be used and customized by customers and different media, XML formatting such as that used by Reuters is almost essential.

Companies that have a wide range of existing content need to convert it to common formats so it can be used in many forms of distribution.

EMI Music Distribution has established a system in which 135,000 items, including songs, videos, lyrics, and cover artwork have been digitized as master copies, which can be converted for use in any media from CDs to mobile phones.

These kinds of enabling infrastructure provide a foundation for firms to be flexible in implementing syndication business models as the environment shifts.

The scope of syndication is rapidly broadening.

Providing information such as product catalogs to distributors and exchanges is effectively a syndication process.

As we will see in Chapter 9, syndication is increasingly relevant to services as well as content.

5. Rework Your Product Versioning

The Ministry of Sound Nightclub Example

One of the essential excursions for any youthful visitor to London is the Ministry of Sound nightclub, established in 1991.

The owners have parlayed the nightclub's success into one of the premier youth brands in the UK and worldwide, encompassing the world's bestselling dance CD, around 200 dance events annually around the globe, a popular monthly magazine, a radio station, merchandise and more.

In its latest addition to its portfolio of businesses, it is launching a digital music store in conjunction with Peter Gabriel's OD2, offering a massive library of dance recordings and videos from major record labels.

It provides three services to its subscribers. They can purchase and download individual tracks that can be kept, burned to CDs, or transferred to portable devices.

In another service, top DJs compile the latest sounds into monthly music programs that provide unlimited access to streams and downloads, but the music files can only be used for 30 days.

Finally, a personal playlist gives users each month unlimited access to streams or downloads of their choice of tracks. Again, these can be played for just 30 days.

Why Content Versioning Matters For Distribution

Versioning - releasing content in a range of versions with different features or at different times - is one of the core strategies in the business.

Books come out in hardcover before they are released as paperbacks.

Major films are released first in movie theatres, then in turn on DVD, video, cable programming, and free-to-air TV.

Software is often available in both a full-featured version, and one with reduced functionality that is cheaper or sometimes free.

As the content distribution landscape shifts to the digital, versioning becomes if anything more important.

However the old approaches are often not the best suited to the new environment.

Most importantly, both promotion and protection have become more important, and the balance between them is shifting.

The Problem of Digital Piracy

Clearly the ability for users to pass on digital copies, sometimes after cracking the protection, has become a dominant factor.

Film and TV content owners are often reluctant to release their programs onto digital TV, because they can be readily copied and shared.

The entire economics of the film industry are built around the staged release of movies in different formats, with the premium revenue movie-theater release going first.

For now, film studios are doing everything they can to maintain their current system, partly by avoiding any form of early release that could possibly be cracked and made available on the illegal market.

However if consumer attitudes to file sharing and broadband technology advance faster than copy protection technologies, it is possible that content owners will have to rethink their versioning strategies.

Ross Dawson is founding chairman of four companies: Advanced Human Technologies, Future Exploration Network, The Insight Exchange and Repyoot. He is author of Developing Knowledge-Based Client Relationships and Living Networks. He also has written white papers for organizations including SAP and Microsoft, and has published over 100 articles in leading publications worldwide. Ross was recently named by Digital Media magazine as one of the 40 biggest players in Australia's digital age.